“I do know building material has been going up due to energy cost.”
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How do you know?
In my view, construction cost will drop 20%-30% from the peak. Contractors are finishing up houses under construction now, but they’ll go begging for work in the next few years.
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From the February 19, 2007 Issue of ENR
Housing Puts Pressure on Lumber Prices
Last year, the single-family housing market fell 12% in dollar volume, according to McGraw-Hill Construction. That drop in demand is dragging down lumber prices. In February, ENR’s 20-city average price for the most commonly used species of 2 X 4 lumber fell 5% from the previous month. This follows more than a year of price declines, which leaves ENR’s price 16% below February 2005’s level. Prices for plywood fell earlier during the housing cycle and are now 4% below a year ago.
